Yahoo announces 2,000 job cuts | Hacker News Reader

Yahoo announces 2,000 job cuts

finance.yahoo.com

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I am frustrated to see a great company get destroyed like this.

Scott Thompson, CEO of Yahoo! says:

"We are intensifying our efforts on our core businesses and redeploying resources to our most urgent priorities. "

In the background, unstated but assumed, is the theory of business "core competence". I believe the phrase was invented by by C.K. Prahalad and Gary Hamel in this May, 1990 issue of the Harvard Business Review:

http://hbr.org/1990/05/the-core-competence-of-the-corporatio...

Sometimes a great essay gets badly misinterpreted.

Since that time, there have been many, many books that have developed this idea. See "Strategic Management and Core Competencies: Theory and Application" by Anders Drejer.

Inspirational for this concept was what Jack Welch argued for while he was CEO of GE, during the 80s and 90s: the company must be in the #1 or #2 spot in any industry, otherwise they will leave that industry. This is taught to MBAs. I have the sense that most of them draw this lesson: shrink the company down and focus on whatever currently works. My concern is that this frequently means focusing on what works in the short-term, without much thinking about where growth will come from over the long-term.

The original essay by C.K. Prahalad and Gary Hamel can be interpreted in another way. This sentence sounds like it is describing Amazon.com, constantly inventing new services:

"A few companies have proven themselves adept at inventing new markets, quickly entering emerging markets, and dramatically shifting patterns of customer choice in established markets."

When CEOs have no idea what a company should do in the long-term, they claim that the company is going to focus "our efforts on our core businesses". There is absolutely no hope for a company that follows that strategy. Especially in technology, where things change quickly, one needs to be inventing the new, new thing, or one is dead.

I wonder what Jack Welch would do if he became CEO of Yahoo. Or what would Steve Jobs have done?

Jobs was a strong proponent of both "cut the crap" and "invent the future" product management.

jobs would cut the email export tools imap/pop access and start charging for every account.

now, back on topic, there's no silver bullet for anything. a company should be in the #1 and #2 of any market and while at there, try to invent new markets to keep being the #1 or #2 at something in the long run.

It was on topic, you shoved it off topic with your BS characterization. .me accounts have always had IMAP and POP access. They're also free. Try trolling again.

I remember hearing this when I was in business school, how in one case study a company "returning to their core competency" would be presented as a good thing while in another case study, "diversifying their business model" was also presented as a good thing. It took me a while to see that it all depends on context and ability to execute.

I'll refrain from making any comments about Yahoo's ability to execute.

Actually it depended mostly on hindsight bias. For those companies that succeeded, we invent a narrative and apply it backwards in time to decide that "core competencies" or "diversification" was the critical inflection point.

But it might have been due to the rise of the dollar against the yen, or the effect of an outbreak of gastro in the plant of a critical supplier in Guatemala, or because a supplier's supplier went bankrupt and your supplier is preoccupied trying to get money from the smoking ruins of a business you know nothing about.

> There is absolutely no hope for a company that follows that strategy.

Well said. It may work or even be optimal in mature areas where there is little or no change. But in a technology company failing to adventure into new areas aggressively is death. Consider that once Yahoo was the 800lb gorilla and Google was the tiny startup. Where was Yahoo's Android? Where is their Google docs, etc? They've made lots and lots of small bets but they never made the big bets, at least, not successfully. Now they are too weak to make big bets, but they should make them anyway, possibly under a different brand.

> I believe the phrase was invented by by C.K. Prahalad and Gary Hamel in this May, 1990 issue of the Harvard Business Review

A quick search of google will show you it was around quite a long time before that.

> Inspirational for this concept was what Jack Welch argued for while he was CEO of GE, during the 80s and 90s: the company must be in the #1 or #2 spot in any industry

Jack Welch took an industrial organization and mortgaged it. GE capital was an enormous percentage of the company when he left. Sure enough, a credit contraction caused GE to take a bailout in 2008.

He talked a great game, but their performance was exposed after he left.

From Wikipedia:

"A core competency is a concept in management theory originally advocated by CK Prahalad, and Gary Hamel, two business book writers."

No doubt the phrase was used before then, but I've never heard anyone suggest that the very specific business meaning it has now existed before their article.

I was recently lucky enough to be in a conversation with an ex-VC who, in the process of discussion, illuminated me on a variety of things, but one of the things that stuck was this:

"A company should never forget what its business is." Pennsylvania Railroad was at the top of its game, evaluated as the best run company in America, and was projected to have nothing but upsides. Within ten years of that point, they were bankrupt.

If you'd asked the executives of the company "What business are you in?", you likely would have gotten "the train business" as an answer, when in fact, the real answer was "transporting people and goods."

The train was, for all purposes, just the vehicle (in all senses) used to get that done. They focused on what they thought were their core competencies, and as a result, went the way of the Dodo.

I think it's interesting as it applies to Yahoo because, frankly, who knows what their core business is anymore, or what their direction is? Even with other semi-ambiguous "web" companies, you can usually target what, or how the company makes its money, and how they can expect to make their money in the coming months and years, but Y! has shifted gears so many times over the years, and made so many false steps into new markets, only to backpeddle out of those same markets just as quickly, I think it's hard for them, a rather successful business with a ton of money in the bank, to know where their money comes from tomorrow.

When working out what business you're in, you should ask yourself, "why do my customers pay me?", not "what do my operations do?"

For example:

Google is in the same industry as News Corp. They sell advertising space, that's what they're paid for.

So with Penn rail: what are the customers paying for? It's not trains or rail operations. It's getting from A to Z.

Yahoo has over 18,000 employees (and not 14,000). The extra 4,000+ are contractors. This is a scheme that the bureaucrats at Yahoo figured out pretty early: announce layoffs, and then bring the employees back as contractors. "win-win for everyone", they joke.

I really, really hate to see people get laid off; But this was a long time coming. As an ex-Yahoo, I hope they cut out the thick layer of bureacracy thats sucking the oxygen out of that place. Ever seen the algae that suffocates a pond? The middle managers there are like that algae. And then there the VPs: at last count Yahoo had over 200 VPs. Really, What do these fuckers do!?

If Yahoo can become more engineering-centric, it has a chance. If the middle managers (and VPs) win out, stick a fork in it; theres no hope.

Was there a culture at Yahoo that indicates that it would do the unusual: fire middle managers before firing the rank-and-file engineers?

The managers always survived layoffs; the engineers, not so much. Has that changed now? probably current Yahoos can tell, but I imagine there a bit busy right now to post on HN.

it looks like it might have

I completely agree with you. Long time coming. I could see this from a mile away.

During college I worked at a Midwestern regional supermarket, and they were employing similar tactics. No more full-time employees. Full-time implies benefits. Part-time employees will work the same amount for possibly even the same wage, but it costs the company a lot less.

"The only thing we learn from history is that we never learn from history." -Hegel

See Research In Motion (RIM).

That's got to be bogus. How likely is it that Hegel said anything so succinct?

I was curious too, and tracked it down to this. Only slightly more verbose than the quote!

But what experience and history teach is this, - that peoples and governments never have learned anything from history, or acted on principles deduced from it.

http://www.marxists.org/reference/archive/hegel/works/hi/his...

Excellent! Thanks. Interestingly, Hegel's argument is opposite to what the other quote says. The other quote implies that we could learn from history if we bothered, but we don't bother, so we never learn. At least that's how I read it. But Hegel's saying that people always try to learn from history and we should stop trying because it's impossible:

Rulers, Statesmen, Nations, are wont to be emphatically commended to the teaching which experience offers in history. But what experience and history teach is this, - that peoples and governments never have learned anything from history, or acted on principles deduced from it. Each period is involved in such peculiar circumstances, exhibits a condition of things so strictly idiosyncratic, that its conduct must be regulated by considerations connected with itself, and itself alone. Amid the pressure of great events, a general principle gives no help. It is useless to revert to similar circumstances in the Past.

>And then there the VPs: at last count Yahoo had over 200 VPs. Really, What do these fuckers do!?

These folks simply have goofy titles.

I used to have one of the world's largest banks (by AUM) as a client. They had over 200 "Vice Presidents" in one building, as it basically was their preferred title for "manager".

At Bank of America, VP was one title below most managers. VP basically meant "didn't get completely fucked in the offer negotiation process".

Bank VP is a different situation, most branches can not issues loans without a VP present- so there are many people with such title. There is standard and there no confusion that this is a high title in banking. Other titles like "Executive VP" are used to identify actual officers. That being said- I would still be interested in hearing if everybody at Yahoo is a director and/or a VP.

>Bank VP is a different situation Not in investment banks, which have no retail presence at all.

Weird. When were you there? I was at BofA securities via the merger.

Microsoft has almost 90k contractors, yes, really.

It seems that I'm the only one here in the comments with this opinion, but I think it's "not a bad thing" (TM).

Yahoo! can still make money. It can still be a "successful" company. What it's not any more is a giant that can be ranked along the likes of Microsoft, Google, and as of very recently and who knows for how long, Facebook. What it needs to do is become much, much slimmer. Focus on its core products, come up with good ways to capitalize on their (still) enormous user base while it lasts, and cut the fat.

The fact of the matter is that any company going from one of the biggest giants in the industry to "just another tech company" has tons of fat it needs to shave off. Yes, it sucks that our friends and family are losing their jobs, but from Yahoo!'s point of view, it's really the only solution at this point. They've tried to maintain their "giant" status for a few years now, and a demi-merger with MS would have been their last hope. But it's clear that it's not working and Yahoo! needs to slim down, focus, and then worry about reclaiming its spot in the limelight. You can't rebuild while losing money at the seams.

I would argue that to maintain their core identity and products, two thousand employees isn't even close to cutting it. They need to cut anything that takes too much effort/money, employs too many employees, and isn't one of their core strengths. They don't need 14k/18k employees, they need to get rid of eight to ten thousand of those and hire just a hundred or so hard-core R&D idea/deployment heads, and work their way from there.

The only thing that Yahoo! can't do is pretend everything is fine and dandy until it's too late to do anything about it. Like it or not, the people (these human beings with families that are about to lose their jobs) that were hired during days of yore are simply not sustainable nor in the company's best interest to keep.

Just a quick point: Yahoo is quite profitable [1], just not as profitable as some investors wish. I only see one quarter of the last 20 with negative EPS.

http://data.cnbc.com/quotes/YHOO/tab/5

edit: Also, I see essentially no hope for Y! though I'd love to be wrong. Consider:

(1) they should have owned the display rtb market. Instead, internal bickering and stupidity handed it to Google. Y! had the first rtb system (rmx), and screwed up so badly that the current next best rtb system compared to google -- appnexus -- is run by the former rmx cto. This will be the next business that is material to google's earnings and yahoo should have owned it.

(2) Scott is talking about ditching rmx and apt. Pray tell, what the hell is he going to run Y's business on, and why is it going to be any cheaper if they're paying for that software from someone else?

(3) They gave away search, and decrease market share and search rev every quarter. Golf clap.

This is a little meta, but am I the only one that feels a little weird up-voting headlines that are bad news? It sort of feels like I'm saying, "2000 job cuts? +1 That's what I like to see!"

Also, it's a little weird to be reading a piece about Yahoo, under a Yahoo domain that talks about Yahoo in the third person (e.g. "Yahoo! today confirmed...", a whole section titled "About Yahoo", etc).

Don't feel weird, an up-vote is just saying "I find this interesting". Bad news can be interesting, but that doesn't mean you like bad news.

I get that feeling too on Facebook (I don't "like" bad news). But this is HN.

actually, facebook changes the "like" text for shared news (I forgot what it depends on, maybe the url not being a fb one) to something like "recommend".

I remember being really surprised until I was pointed out that you don't want to "like" some of the news.

I believe that is set in the metadata of the original article. I may be wrong, though.

Yes, it's an option when installing the like button. Along with "show faces", color scheme, etc.

https://developers.facebook.com/docs/reference/plugins/like/

It still feels weird, even with "Recommend."

"Tornadoes destroy trailer parks, strip malls in Texas" - Recommended by 241 people

"A++ Tornado, Would destroy again!"

layoffs for programmers are usually good news. It means a dying company is freeing up those resources to go towards better uses. E.g., more start-ups etc.

With a company like Yahoo, you can bet their programmers learned a lot about coding, maintaining, user/management expectations, and internal politics. While losing your job sucks, those skills transition very well anywhere you go. If you're a bad programmer and you didn't learn how to be a better programmer at Yahoo, you're going to be in a world of hurt. If you were at least decent and learned what you could, you might be in a better position to negotiate with a new company, or, like you said, start your own project.

Out-of-work programmers are only at a disadvantage (respective to other industries) if their true title would be more like "COBOL coder". A semi truck driver only struggles to find work if he drove nothing but an automatic for his whole life.

You show the problem with these voting systems. One is inclined to up-/downvote things based on if one likes what is there, not if it is worthy being discussed/shared/read.

Look at it more as "I recommend this story" than "I like this story".

Don't think of it as 2000 job cuts, think of it as 2000 prisoners set free.

Inertia can be a difficult force to combat when working for a large company. From personal experience, being layer off, or having a project cancelled, is the ultimate incentive to find something better.

Of course this is stressful, and no severance package makes much difference to the stress of a real human being with responsibilities and bills to pay, but I do believe that the upside is significantly bigger than the downside

It's only stressful if you let it be. When I was lay'ed off from a previous position (with 6 months severance) it was the best thing that had happened to me in a long time. I even turned down the first job offer I had, cause I didn't really like how that company wasn't investing in upgrading their infrastructure.

Now, my wife's stress level, well that is another discussion.

I don't think that is a fair assessment of the situation. While some people may be in a position where getting laid off from their job is a welcomed incentive to pursue bigger and better things, there are also those people that rely on that steady income to pay their bills and keep their families clothed, fed, educated, and healthy.

I also want to say, although I don't mean to imply that this was your personal assumption, that not every person working for a technical company in the valley is a risk taking entrepreneur. Some people just like to program.

I agree, each of the 2000 is an individual human with their own narrative. The worst mistake management can make is to forget that humanity.

I expect they're also targeting a lot of senior (read: high-salary) employees who are more likely to be the family bread-winner types. (Although for legal reasons Yahoo! will go to great pains to point out that they are not in any way targeting older employees.)

I am under the impression that laid off employees are going out with a good severance package. If it is true that there is no severance for laid off employees, then it is brutal

are you saying Y! is not paying severance or just speaking about "no severance" situations in general?

It's not about whether or not you like the news, or if you agree with it. It's about adding value as a story relevant to HN, with the possibility of insightful conversation. I say upvote away!

You're line of thinking is why too many people's insightful comments are downvoted. Purely out of disagreement, or "I don't like that idea". Really that's the biggest problem I find on HN.

Well, upvoting a story isn't the same as "like"ing an article.

I don't say this to be snarky, but I will say that this post about yahoo is a link to yahoo's press release portal aggregating third party press releases kind of indicates where they're going.

Yahoo News is still the top news site. Yahoo business/finance is still among the strongest financial properties. The good news is that Yahoo's not going anywhere. The bad news is they're not going anywhere.

Yahoo have always been into aggregating other news stories into a Yahoo News site (from day one when they syndicated Reuters). Including press releases. It's where they've always been, rather than where they are going.

Really? Top three stories on Yahoo News UK right now are "Driver survives 200ft truck plunge", "Labrador 'adopts' abandoned duckling" and "Flying car cleared for takeoff" [1]

By what metric exactly is Yahoo News still the top news site?

[1] http://uk.news.yahoo.com/

http://www.ebizmba.com/articles/news-websites

Take your pick.

By what metric exactly is Yahoo News still the top news site?

ComScore. Yahoo gets an enormous amount of traffic: Alexa also considers Yahoo as a whole the #4 site (behind Google, Facebook, and Yahoo). And Y recently hired a White House correspondent (http://news.yahoo.com/yahoo-hires-first-white-house-correspo...) and has made some other fun hires in the reporting space.

My friends who work in tech don't visit Yahoo. But my extended family in the Midwest sure does!

Full disclosure: I work at Y, but definitely don't speak for Y. If you have ComScore access, you can double-check the "#1" stat I cited.

"Alexa also considers Yahoo as a whole the #4 site (behind Google, Facebook, and Yahoo)"

From looking at Alexa, I believe your second "Yahoo" should have been "YouTube."

You're right. The "edit" button has expired.

I think the news is personalized :)

Well, I just lost one coworker and my boss, both of whom were good people and good workers. I think this seals my decision to move on; I only really came to work here because I did internships and felt like I owed it to my boss to put in a year or two... but if she's gone, then I've got no reason to stay.

Anyone looking to hire in the Bay?

edit: make that two coworkers

Anyone looking to hire in the Bay?

Any interest in Google? If so, feel free to send your resume in my direction, jrockway AT google.com. (Also good if you look at google.com/jobs and list a few that interest you.)

My company is hiring. send me your résumé. deliciouscake (at) msn.com -- i'll send you back our list of openings and refer you if you're a good fit. I'm not a recruiter, just an engineer, so i won't be giving out your email or giving you the hard sell or anything.

We're hiring at Netflix for all types of positions. We have some ex-Yahoo folks that are doing really well here. If you are interested, just shoot me an email (in profile) with what kinds of roles you are interested in, and I'll get you over to the right people.

   Anyone looking to hire in the Bay?

Are you kidding me? Easier to make a (short) list of who isn't hiring in the bay right now. If you want to work on hadoop / clusters / ad tech / rtb, send email to ehathaway at quantcast and I'll send your resume to our internal recruiters. I am, btw, an engineer, so feel free to ask any question that isn't directly covered by my nda and I'll answer or tell you I can't.

earl's profile page does this right: his email is in his "about" section.

Since this will probably stay at the top of the "looking for work" comments, here's a quick note -

Please put your email info in the "about" section of your user profile.

* Unless you're like me, and don't want to publicize your email.

Sorry you have to go through this, but you shouldn't have any trouble landing a job.

Along with the other great companies listed above, Facebook is hiring as well. I work with infra systems - if large hadoop clusters, compilers, or kernel work tickle your fancy, feel free to send me an email: cael2 [at] fb.com.

We're a small company of really great people that is aggressively hiring. http://triggit.com/careers

hopefully for some Xyahoos new exciting opportunities will present themselves... like moving to Austin TX! we are a bold exciting company thats hiring right now and offering a free place to live. i am a co-founder, not a recruter, alex at wisp.io.

Take a look at Euclid, http://euclidelements.com/about-us/jobs

I'll throw in with everyone else. TrialPay is hiring. Small eng team. No bureaucracy. Really smart people. Actually making money. aline@trialpay.com

The CEO, Scott Thompson is apparently leaning on a group of management consultants from Boston Consulting Group to come up with a turnaround plan and these firings are apparently the result.

Do CEOs really ask outsiders for ideas on how to run/turn around a company? I am in the wrong profession! I wouldn't mind dispensing advice on how to do things I have no experience in doing, all the while pulling in 300+ $ an hour. Somehow I can't visualize (say) Steve Jobs outsourcing thinking and decision making.

The closest thing I've seen in software is a couple of instances of bringing in agile methodology consultant/book author types to save failing projects. Those didn't work out well either.

define "apparently". i'm honestly curious

"define "apparently". i'm honestly curious "

Apparently: dictionary meaning = apparently [əˈpærəntlɪ əˈpɛər-] adv (sentence modifier) it appears that; as far as one knows; seemingly

Kara Swisher reported at http://allthingsd.com/20120330/yahoo-layoffs-set-to-begin-ne... that

"Thompson, along with consultants he has hired from the Boston Consulting Group, presented the possible plan in front of Yahoo’s senior execs on Tuesday. "

Lacy from Pando "We’ve heard that Thompson has spent most of his tenure thus far holed up in the executive suite with Boston Consulting Group. "

So there have been some reports but I don't work at Yahoo and haven't seen this with my own eyes. Hence "apparently".

Did that help satisfy your 'honest curiosity'?

ah, from allthingsd. thanks.

IBM was turned around by a formater McKinsey consultant, Louis Gerstner.

Was it? Or rather is it? Any details?

They've certainly "turned around" where it matters to the company: https://www.google.com/finance?client=ob&q=NYSE:IBM

Do CEOs really ask outsiders for ideas on how to run/turn around a company?

Sometimes. More often, they bring in outsiders to articulate a decision they have already made, especially if it’s going to be unpleasant.

Do CEOs really ask outsiders for ideas on how to run/turn around a company?

CEOs can't be experts at everything and often don't have the time necessary to research everything they need to research. So as such it's quite reasonable to get people to help them out, especially when you are a new CEO and have to get up to speed really quickly. Getting people from outside the company rather than inside the company minimizes the chance of the information the CEO gets being biased by deep rooted corporate culture or by sycophants or back-stabbers looking out for their own best interest.

Ex McKinsey consultant.

Yes. It's shocking how much of what you see in the papers is driven by consultants and investment banks. There are a few companies who disavow the use of them, but most are unafraid to bring in hired guns.

The not so smart companies hire large teams of consultants who stay there for years. These are expensive employees.

The smart companies use the consultants well to get rapidly informed about certain decisions - such as an acquisition or strategy.

The really smart companies use consultants to help build knowledge or capacity (e.g. how to analyze a potential acquisition) and then kick them out immediately afterwards & keep doing it themselves. VCs were good at this.

The extraordinarily smart compares are spending too much time hanging out with customers and understanding their unmet needs to worry about hiring management consultants. Of course there are consultants that can help with the ability to observe customers as well...

Yahoos –

Today we are restructuring Yahoo! to give ourselves the opportunity to compete and win in our core business. The changes we’re announcing today will put our customers first, allow us to move fast, and to get stuff done. The outcome of these changes will be a smaller, nimbler, more profitable Yahoo! better equipped to innovate as fast as our customers and our industry require.

Over the last 60 days, we’ve fundamentally re-thought every part of our business and we will continue to actively consider all options that allow Yahoo! to put maximum effort where we can succeed. As part of this process, I believe we have to focus to win in a select group of core businesses globally:

· Core Media and Communications: Our content, media, and communications experiences must be best in class. That includes getting today’s core properties right and innovating on a next generation of great product experiences across all screens.

· Platforms: We must make our core platforms and systems a genuine strength for Yahoo! – platforms that we can really leverage to support our massive scale, drive the deepest personalization, and boost speed to market.

· Data: Our massive data sets must become a genuine competitive advantage for Yahoo!. We have to unlock the value in our data to allow us to really understand our 700 million users, encourage and win their engagement and trust, leverage everything they do with us to more fully personalize their experiences, and to give our advertisers the immediate insights they are rightfully demanding.

We are intensifying our efforts on our core businesses and redeploying resources to our most urgent priorities. Our goal is to get back to our core purpose – putting our users and advertisers first – and we are moving aggressively to achieve that goal.

Unfortunately, reaching that goal requires the tough decision to eliminate jobs, which means losing colleagues and parting with friends. Today, we will begin the process of informing employees about these changes. As part of that effort, approximately 2,000 people will be notified of job elimination or a phased transition. We value our people and for those who will be leaving, we thank you for all you have contributed to Yahoo!. We will treat all of our people with dignity and respect, providing resources to help manage through their transition.

Change is never easy. But the time has come to move Yahoo! forward aggressively with increased focus and accountability. Our values have always been about treating all Yahoos with dignity and respect, and today is a day to embrace those values. This is an amazing company with exceptionally talented people and I know we will all do our best to encourage each other through this difficult period of transition.

Thompson-Scott.png

EDIT: The mail sent to us by our respected CEO Scott Thompson.

re: Data.

not sure how they are going to unlock their data as they cut back on y! labs.

https://twitter.com/#!/smolix/status/180064462294876162

Unlocking could be something like selling it off.

Yahoo's research divisions do great work that basically never makes it out into the wider company past the prototype stage. It is an awesome, wonderful waste of money.

Wow. I had no idea Yahoo! had their own "Bell Labs." Neat. (Or perhaps, tragic)

Two layoffs ago they cut 'brick house' which was a hands-on innovation cell, purveyors of live.yahoo.com (a 2007 version of chatroullete with many more features and 5-way video chat) and fire eagle, the GEO standard, and other nice stuff.

man, it's depressing to count a company history in 'layoffs'

5 way video chat == Google hangouts?

Yup. They are similar. Yahoo! Live was pretty awesome.

I think Y! Research has contributed

(1) hadoop enhancements (a friend works there on exactly that), which are a nontrivial cost savings given the size of Y's deployed clusters

(2) ad matching tech, which should be considered of the highest priority, given that Yahoo's business model is to make money off advertising. Small improvements in matching <users, stories, ads, context> can easily lead to material improvements in earnings

Why Y! doesn't consider the two above things important is beyond me. Also, one of their recruiters sent me an email this week! Dude has big old brass ones, that's for sure.

That's about as vapid as anything I've read.

Except for the part about eliminating positions -- of people who, you know, might actually do something.

P.S. To clarify, my comment makes certain assumptions about what positions are and are not being eliminated.

I'm going to guess they're not eliminating the positions of the key decision-makers that got them where they are, but that's just pure cynicism and stereotyping on my part. :)

Corporate leadership and VPs are always last to go. Unless you've got one helluva board of directors.

I've seen cuts in which the head office was gutted. Five C-level execs gone.

Along with about 25% of FTEs, to say nothing of contractors.

And the company's still around.

Well, Yahoo's had a pretty aggressive refresh rate on chief executives of late. I don't think your assertion really holds.

"The changes we’re announcing today will put our customers first, allow us to move fast, and to get stuff done."

I always find it amusing that, when big companies keep adding people and byzantine processes to a project, it's so they can "get stuff done." Then, when they fire those people, it's for the same reason, even though most of the people in the trenches could have told them they'd have got more done if they'd avoided the extra overhead in the first place.

It's just PR. You should take it with a grain of salt.

You do need more people to get more stuff done (i.e. taking additional risk to build new things). And you do need to lose people if you're short on money. There's really no way around it. You shouldn't fault companies for taking risks when they have the chance, our civilization would be pretty stagnant otherwise.

PR for emails sent to employees? Oh yes, that's Yahoo. When I was there they actually had a PR department exclusively devoted to internal communications.

is this really that strange for a company this size to consider PR aspects of official email from C-level execs when it will surely leak?

Not strange, just depressing that employees are just fungible resources who don't really require a clear explanation for the current situation; and how this layoff is any different to the previous 5 rounds in the last 4 years.

Surely the key thing about these types of emails is to rebuild trust/solidarity in retained employees or bolster confidence that this isn't just another numbers and spreadsheet game, and that this time they have a clear vision, a strategy and a viable tactical plan on how to deliver that.

He loves the word "core", I spotted it about seven times. Corporate buzzwords whats up!

I wonder what the delta of their locked to unlocked data solutions are? Hopefully they can map some of their new-found agility to a function that provides higher returns for their valued investors.....

WTF are you still there? Are you an H1B sponsored by Yahoo and thus trapped?

One thing that sticks out there for me, the email mentions putting customers first while the article mentions putting "users and advertisers" first.

Always sad to hear about that many people losing their jobs - but, at least the technical job market is as strong now as it has been in a decade.

With a workforce at the end of last year of >14,000, this is clearly a substantial reduction in headcount, but the company isn't exactly "closing up shop."

I'm curious about what areas will be hardest hit by these layoffs. Really good stuff has been coming out of Yahoo research over the last several years, and it would be a shame to see that investment pulled off the table.

Perhaps the crux of the issue are the problems PG observed at Yahoo! over a decade ago are still an issue today.

As long as PG's observations hold true I think Y! will have a difficult time turning itself around.

PG's canonical article about Y!: http://www.paulgraham.com/yahoo.html

Not a good day to be a contractor and the least senior person in your group. If anyone has been through corporate layoffs before, do you know whether they usually target the most senior people (because they're the most highly compensated) or the least senior (because they're easily replaceable)?

My experience has been that politics (who's friends with whom) plays a lot more into it than competence, pay, or seniority.

There are essentially two kinds of layoffs: "We're getting rid of Division X and everyone in it" and "We need to reduce expenses and so we're laying off people." In this case, it sounds like a little bit of each.

There are entire companies dedicated to executing (pardon the pun) layoffs "correctly" and there are as many ways to do it as there are managers, but they essentially fall into three categories: cost-based (get rid of the most cost), skills-based (get rid of the people who don't have skill X that we totally need) and performance-based (get rid of the people who suck). Most of what you're talking about sounds cost-based, in which case there's two philosophies: get rid of the most senior people who charge the most (hello, age discrimination lawsuits) and get rid of a lot of junior people whose productivity is lower and expect the senior people to pick up the slack.

And yes, I have had the privilege of working in a Fortune 500 company and helping put together a layoff list - worst job of my life.

There can also be accounting considerations. Sometimes contractors are the first to go, other times they are last. Carrying a contractor frequently looks much cheaper than carrying an employee.

I haven't run into this in person, but my dad worked for years at a BigCo engineering firm that had multiple rounds of layoffs, and they seemed to use a fourth strategy: try to get as many volunteers as possible by offering some severance packages, and just take whatever random assortment of people said yes. The theory was that that was the way to reduce headcount with the least impact on morale, since nobody was actually being fired. In practice some people were strongly hinted that it was in their best interests to take the package, though. It also tended to be de-facto biased towards getting rid of the older/more-expensive employees (who would just take early retirement) without overtly singling them out.

My experience during corporate layoffs seems to lean toward letting the senior people go. Whether contractor or employee, doesn't matter. Twice I saw them ask 30+ year employees to retire and, when they said no, let them go within a week.

It's usually not that black and white. It can also be "which of these employees is least likely to make the transition to where we are headed?"

About three months after I was hired at a company they reduced headcount by 25%. Even though I was one of the newest people there (though in terms of experience and salary I was more senior), management came to me and said that my experience and flexibility was going to be key in where they were headed post layoff and I wasn't going to be affected.

Long story short, it really depends. It's not always down to salary. Without getting into a lot of legalese (and every situation varies), when you do a layoff, you're eliminating the position and not looking to rehire, so you're generally not thinking about replacements. You're trying to figure out which staff is going to get you from here to wherever you decided you need to be.

That's definitely been my experience as well, albeit at smaller outfits.

Gruber nailed it: “This rings a bell, circa 2008”

the steps we are taking are not easy for us as a company, but as we become more fit as an organization, decision-making will be faster and it will be easier for us all to get more done and stay focused on our strategy.—Jerry Yang

http://allthingsd.com/20081021/jerry-yangs-complete-memo-to-...

that was the "no sacred cows" themed layoff, IIRC.

I'm an ex-Yahoo. I have friends there and have sympathy for how hard today must be.

But I strongly think this is the right move for the company. They had way too many people, more than what they need/afford and were the cause of much overhead. Of course, it all depends on whether they're laying off the right projects/people.

I hope they fired the marketing experts who made the decision to have flying cars and zooming coke cans in my face and disrupting the home page. What a joke. Yahoo was my home page for years and when they started that non-sense I switched to duckduckgo.com and haven't been back.

They were trying to hire me right before the news hit. They have a lot of nerve. I am dumbfounded. Good thing retaliatory managers have left me without references and I would bomb out of the process for that reason, rather than for a lack of technical ability.

In other news, I have made a string of bad decisions as far as who to work "for." I should do something about that. Perhaps I should let someone (more capable) decide what I do next.

Sometimes its good to have no choice but to follow your dream, all else and all other's (face saving, arrogant) bullshit aside.

Savings of $375M annually would imply an average of $187500/ employee. Does this seem high to anyone else?

I can't imagine all of these employees are cream of the crop engineers/managers.

An employee costs more than their salary; there's health insurance/benefits, payroll tax, IT+support costs, etc.

that's fully loaded costs, which are much, much higher than salary

In addition to the fully loaded costs, Yahoo also pays higher salaries than most companies in SV.

Dear Yahoos, you might have been let go, but you should be proud:

http://www.youtube.com/watch?v=mh4jvDsNtEE

Devs are fine. We lost all our QE.

Any idea if they're laying off software devs? They're still in high demand here in NYC.

Of course they will be. They aren't going to cut exclusively from sales and service engineers.

Random anecdote: A few days ago I was heading to Dublin Airport when I spotted the Yahoo! logo covering the entire face of very large building. First thought: "That's pretty cool", Second Thought: "Wow, those guys are still going?"

And that's why it's going to be hard for them to find success turning themselves around. Even if they came up with some killer new product, a lot of people would never know about it, and a lot of the ones that did would be skeptical because it's yahoo. When I worked there a couple years ago, they were very high on their brand's value. I'm not sure they should be. I think they might have more success launching (or buying) smaller, more self-contained sites with their own brands, similar to what they did with Flickr. (Of course, I have no idea if Flickr is actually a money maker for them.)

Yahoo recently retired their famous neon billboard that had been in downtown San Francisco for many, many years. The billboard was ugly, but it was a sad sign of the times when it came down. :\

http://news.cnet.com/8301-13772_3-57327029-52/san-francisco-...

it wasn't ugly :(

It certainly wasn't as ugly as the atrocities that have replaced it.

We can agree it was objectively very … purple.

http://www.thesfegotist.com/editorial/2011/november/16/end-e...

I think I might have known at one point, but what does yahoo actually do? I can't think of a product / service. Search?

Irellevant is an understatement.

Can someone explain "sophomore Computer Science and Business major" (me), why Yahoo's stock is going up with these news? (Currently it is +0.77%)

Thanks

the layoffs were probably factored in already...and they were probably expecting a higher number...so if the number falls below street expectation the stock price goes up

Lower costs mean higher profits. Lower # of employees gives them greater flexibility, they can hire contractors where they need them and eliminate positions where they don't.

It's because the fundamental issues causing the layoffs should already be priced into the stock (due to poor earnings reports and such). So layoffs are considered a good response to the fundamental issues and cause a price increase.

Stock price respond to changes, especially unexpected changes (expected ones are mostly priced in) and new information.

The short term price increase is not a sign that investors think the company is doing good (or bad) generally. They already have an opinion and it is already priced in. This is ("theoretically") a sign shareholders agree that this is the right thing to do. It's not uncommon for share prices to rise following news of layoffs. Companies don't like to fire. They usually err on the side of not firing (even when necessary). So, this suggests management doing hard, presumably necessary stuff.

How ironic is that ?

http://www.youtube.com/user/yahoo?ob=4

Sorry guys. :(

looks like a lot of fat is being cut out.

Well, Expected.

HN readers should see this as an opportunity to hire experienced, qualified developers, systems engineers, and marketing people. Possibly for salaries lower than what otherwise would be the norm, especially in non-Bay Area markets.

"Qualified developers" ? You must be kidding, I worked at yahoo a few years. It is very true that I have met a few outstanding engineers over there, however, the average engineering skill level right there was the lowest I have ever seen.

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